RTD coffee is a niche category in Lithuania which had been experiencing some impressive growth rates prior to the emergence of the pandemic. With the lockdown imposed in March, many Lithuanians turned to hot coffee while confined to their homes, particularly fresh coffee using coffee machines, driven by a strengthening café culture in the country.
While greater distribution and investment in advertising by brands such as Paulig and Starbucks, which are known for offering fresh coffee, are helping to raise awareness of RTD coffee, smaller producers are attempting to educate consumers by learning about the origins of the drink. With many Lithuanians taking “staycations” in 2020 due to the pandemic, they searched for different activities with local entrepreneurs aiming to take advantage of increased local tourism.
The competitive landscape of RTD coffee is fairly consolidated, with three main players, Paulig Baltic AS, Cocio Chocolademælk A/S and Arla Foods Amba dominating value share in 2020. Paulig has continued to expand its offer since its entry in 2018 such as addressing greater demand for non-dairy variants using almond, coconut and oat milk.
While the outlook for RTD coffee is positive over the forecast period, with the category set to record steady demand, its performance in off-trade volume terms will not be as impressive compared to the review period. Lingering price sensitivity and the fact that the category offers a higher average unit price compared to RTD tea, or energy drinks as alternative refreshing beverages for on-the-go consumption, is likely to restrict its greater expansion.
Ongoing demand for RTD coffee is likely to be driven by younger Lithuanians who tend to purchase these products on impulse during the summer months. They are also more likely to be open to innovation and new flavour variants or formats such as carbonated coffee which has emerged in the country; this is a drink with an extremely high concentration of caffeine and infused with nitrogen.
Coca-Cola is launching a new drink which it hopes will appeal to consumers of both cola carbonates and coffee, thereby having a cross-category appeal while also addressing increasing interest in carbonated coffee. Coca-Cola With Coffee is produced from cola carbonates and Brazilian coffee and will initially launch in the US in 2021.
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Understand the latest market trends and future growth opportunities for the RTD Coffee industry in Lithuania with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our RTD Coffee research and analysis database.
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